A Comparative Analysis of the Manufacturing Sectors in India and China

Abstract

China has set a standard of sustained high economic growth performance for developing economies. India's own high rate of economic growth, especially in the period of 2004-05 to 2011-12, raised the prospect of closing the gap in growth rates with China's performance. However, India has not been able to sustain high growth rates in the manufacturing sector's output. What can India learn from China's performance in the manufacturing sector? This paper argues that while the two countries have much in common, China's policy framework and growth and development experience may not be a model for India, because of significant differences between the two countries, such as geographical features, history of policies and political institutions. The paper argues that although there are lessons that India can draw upon from China's growth experience, they are limited. India has to formulate a policy framework drawing upon its own endowments.